Sunday, January 15, 2012

The non-problem of trade trends

Andres Oppenheimer repeats the same old, tired, and unconvincing story that Latin American countries increasing trade ties with countries other than the United States constitutes a problem, perhaps even a crisis. Why this is the case is never made clear. I refuted the general idea in a December op-ed.

China's economy is doing very well, while the U.S. economy is still struggling. No amount of "attention" is going to change that fact. What's more, the diversification of trading partners is entirely good for Latin America, which then reduces its dependence on one partner. So what exactly is the problem?

Oppenheimer hands himself his own rhetorical sword by quoting someone from ECLAC:

While Washington in previous decades launched ambitious regional initiatives, such as the Alliance of Progress, the Initiative of the Americas, or the Free Trade Area of the Americas, today no such grand plan exists. Washington has bilateral ties, but no regional plan, she said.

Anyone with even a vague knowledge of U.S.-Latin American relations knows that those initiatives were failures. They were bloated visions of impossible futures that paid no attention to political realities within the countries they hoped to attract. The Initiative of the Americas is so obscure and non-influential that I never bother even mentioning it in my U.S.-Latin American relations course.

In short, the current state of affairs should not be considered a problem, and this non-problem should not be compounded with another regional initiative that will be doomed from conception.

But there is little question that for the first time in decades, there is no U.S. regional plan to increase trade ties with Latin America. It’s ok for Washington to look East, but it should also look south. Unless it does so, the bleak ECLAC forecasts for 2020 will come true.

The bleak forecast of what? He never says, and no one ever does.


Alfredo 2:26 PM  

According to ECLAC* the forecast in 2012 for LA shows a growth even with the downturn in other parts of the world. I think the diversification of the LA economies is one of the reasons for this.

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